Alcohol, Estonia, Financial Services, Legislation, Markets and Companies

"I am glad that the Riigikogu decided to cut back the excise duty hike for beer and strong alcohol. An increase in the excise duty on the originally planned scale would have brought with it too big risks when it comes to increases in cross-border trade and fiscal underperformance," Toniste said in a press release.

"Big cross-border trade which takes money out of Estonia is not good for the Estonian economy," the minister said.

The Estonian parliament on Tuesday passed a bill to amend the Alcohol, Tobacco, Fuel and Electricity Excise Duty Act, according to which the excise hike to enter into force in February will be reduced by half.

The bill was passed in the 101-seat chamber by a vote of 50 to 32.

According to the bill, the hike in the excise duty on beer, other alcohol, wine and fermented beverages with an ethanol content of up to 6% by volume planned for 2018 will be halved. Alcohol excise duty hikes for 2019 and 2020 will remain to the same extent as planned, which is 10%, and 20% for wine and fermented beverages with an ethanol content of up to 6% by volume.

The government on the initiative of Finance Minister Toomas Toniste decided to raise the alcohol excise duty planned to enter into force on Feb. 1 by half of the volume initially planned. In order to cover the budget gap that would be emerge as a result, the government is planning to take nine million euros of additional income from the state forest management center RMK this year.